In This Article:
This story was originally published on Trucking Dive. To receive daily news and insights, subscribe to our free daily Trucking Dive newsletter.
Dive Brief:
-
Ryder System has a healthy sales pipeline, but some cross-border shippers are holding off on signing long-term contracts amid uncertainty about potential tariffs between Mexico and the U.S., executives said on an earnings call last week.
-
“I think people are just waiting for decisions to be made as they look at the policy uncertainty with the administration and tariffs,” President and COO John Diez told investors. “But we do expect as we get to the latter part of the year, we're going to see some movement in sales activities and sales wins.”
-
Despite the threat of tariffs on North American trading partners, Ryder is confident that it can manage the effects — if the new duties are implemented at all, Chairman and CEO Robert Sanchez said.
Dive Insight:
Twenty-five percent tariffs on goods from Canada and Mexico, initially set to go into effect Feb. 4, were delayed by one month, but that’s left questions about what’s next.
“There's been a lot of uncertainty around the timing and the final policy,” Sanchez said, adding that it’s hard to decipher what impact might occur across Canada, Mexico and the U.S.
While 93% of Ryder’s revenue comes from domestic operations, the carrier handles about 21,500 border crossings between the U.S. and Mexico and approximately 5,100 border crossings with Canada, according to an annual report.
Sanchez said the lack of clarity is creating some challenges for customers considering long-term contracts but said the transport conglomerate is well-positioned to help customers navigate such uncertainties.
For potential tariffs on vehicles, costs would be passed on to customers, the company said in a statement to Trucking Dive, referring to its ChoiceLease and rental offerings.
TL carrier Werner Enterprises also identified its exposure to trade policy changes while noting rhetoric has been different than actual effects.
Sanchez gave similar commentary that further stressed how much of a moving target the impacts of tariffs might be.
“It's just really hard to tell in terms of what the tariffs, if any, will be between U.S., Mexico and Canada and what the impact of that could be,” he said.
Recommended Reading